With Arch, Codexis will apply its MolecularBreeding™ technology to manufacture an undisclosed pharmaceutical compound.

Codexis has also signed its second agreement with Matrix to develop and commercialize a process for the manufacture of a major undisclosed pharmaceutical product.

Alan Shaw, Ph.D., President and Chief Executive Officer of Codexis, commented, “The generics business now accounts for a roughly $60 billion market, having grown 115% since 1998 alone.”

“We believe that it is essential for Codexis to continue to expand its presence in this area, and we are pleased to extend our program with Matrix and to add Arch to our network of manufacturing partners.”

“In addition to the six agreements we now have in the important generics sector, we anticipate signing at least one to two additional deals within the next six to twelve months.”

“Further, we expect that by 2008 our relationships with generics manufacturers could generate 40% or more of revenues for Codexis.”

Under the terms of the new agreement with Matrix, Codexis will employ its proprietary MolecularBreeding™ molecular evolution technology platform to develop a synthetic process for the Matrix product using a Codexis ThoroughBred™ biocatalyst.

The process will be transferred to Matrix for final scale-up and manufacturing, and Matrix will receive exclusive manufacturing and marketing rights to the novel process being developed.

Codexis will receive research and development funding, milestone payments and ongoing commercial payments on sales of the product.

Under terms of the agreement with Arch, Codexis has granted to Arch a non- exclusive license to the Codexis proprietary biocatalytic system and will transfer the process to Arch in exchange for upfront and milestone payments.

Codexis will supply Arch with the ThoroughBred™ catalyst, and Arch will manufacture the pharmaceutical intermediate. Codexis will directly market and sell the intermediate to the generic pharmaceutical industry.

A team of researchers has successfully used Artificial Intelligence to design, synthesize and validate a novel drug candidate in just 46 days, compared to the typical 2-3 years required using the standard hit to lead approach.